Econ 02 | The Future of Work: Why AI-Driven Automation Is Inevitable

In a previous article, we asked the question: Will AI take my job? I did not give a conclusive answer, however. This is largely because, well, nobody knows the future. However, we can look at how things might change based on how things have changed in the past. Let’s set the stage to explore this further and take the discussion beyond where we left off last time. 

One point I emphasized is that a ‘job’ is in fact a part of the wider system (and hence question) of the overall economy, and the ideas of innovation, production and efficiency. In other words, we cannot look at the question of jobs in isolation, without considering such systemic factors. 

The other point I’ll also emphasize is that human progress - technological, and in tandem, institutional - is like riding a bicycle uphill. You stop and you fall. Even if one society or nation refuses to innovate and make progress, another will - so ultimately, progress is a matter of staying competitive, even of survival!

So, let’s assume we do proceed along this path of technological progress and see where this might lead us, taking this wider economic context.

In recent decades, there has been rapid progress in information technology - in fact we’re practically walking computers, given the computing power and versatility in that flat and shiny object in your pocket. It may even be worth mentioning that a typical mobile phone today has more computing power than all of NASA did when they landed a man on the moon in the 60s.

As a consequence of this, we discussed last time, how the cost of global messaging has fallen practically to zero. And now with the advent of powerful thinking machines - AI that can speak and reason on par with human beings, we can and will offload a whole bunch of tasks in the cognitive domain to AI. This will especially be the case around the more mundane tasks that are inevitable in any professional activity. 

Alongside the progress in the cognitive domain, we are also witnessing rapid progress in robotics - thanks again to AI in general helping accelerate innovation in all other areas too. Thus, we will also offload to the robots a whole slew of physical - and especially burdensome or backbreaking - tasks. 

Let’s talk about why this shift to AI-driven automation is inevitable given such technological progress and why it’s not a bad thing for us. 

We saw in the previous article that in the overall economic equation, a job is a ‘cost’. And that across the march of human progress, we have, using innovation, built and utilized tools, to increase our productivity and thus decrease the cost of a job. 

Artificial Intelligence (including Robotics) takes this to the logical next step. Given that AI/Robotics will be cheaper than human labor, it’ll be economically compelling to utilize AI/Robotics across industry. 

Let’s take an existing example to illustrate the economics and practicalities of this: the Automated Teller Machine - that hole in the wall where we withdraw cash from. 

Some of us might remember human tellers, quaint as that may sound to others. Just a few decades ago, if we needed cash, we’d physically go to a bank, typically queue up in a long line, and eventually ask for and be dispensed a certain amount of cash by a human operator.

It’s not hard to compare the difference in the cost of this job, as done by humans and machines. Not to mention the huge advantages automation has offered us - you can, for example, withdraw cash at an ATM practically at any time of the day or night - something impossible with human tellers and traditional bank opening hours!

And what about the human teller? People doing such jobs have moved on to other areas of banking, in particular customer service and suchlike.   

But, you might say, if AI/Robotics is getting as good as or even better than human labor, what will we humans really do? We will keep exploring this in this series.